SYG(SZ:300740) Zheng Quan Shi Bao Wang·2025-06-20 13:43Core Viewpoint - Water Sheep Co., Ltd. is on the right path towards becoming a global high-end beauty brand management group, driven by its dual business strategy of proprietary and CP brands [1][2]. Group 1: Strategic Transformation - In 2024, Water Sheep Co., Ltd. is undergoing a strategic transformation, focusing resources on core high-end businesses amidst a complex external economic environment and internal structural adjustments [2]. - The company has improved its proprietary brand structure, with a significant focus on high-end brands while strategically reducing its mass-market offerings, resulting in a K-shaped resource allocation [2]. - The proprietary brand system has completed a transformation towards high-end and global positioning, with high-end proprietary brand revenue increasing and gross margin reaching 74.27% in 2024 [2]. Group 2: Brand Development - The French luxury skincare brand EviDenS de Beauté (EDB) has shown positive growth in brand strength and sales in 2024, supported by other high-end brands like Pier Augé (PA) and RéVive (RV) [2]. - The mass-market brand YuniFang has been repositioned to focus on "Researching the East," while the high-end makeup brand VAA has achieved over 10 million in revenue through leading products in niche categories [3]. Group 3: R&D and Innovation - The company emphasizes continuous investment in brand and R&D to combat short-term uncertainties, with R&D being a core strategy [4]. - Water Sheep Co., Ltd. has established a global R&D system with centers in multiple locations, including Changsha, Shanghai, France, and Japan, aiming to empower brand development [4]. - In 2024, the company obtained 42 patents, published 15 papers, and participated in significant academic conferences, showcasing its commitment to innovation [4]. Group 4: Financial Performance - The overall gross margin of Water Sheep Co., Ltd. is on an upward trend as the revenue share from high-end brands increases [5]. - The long-term strategy focuses on minimizing losses from non-core businesses while enhancing operational quality, which is expected to strengthen the company's core competitiveness and risk resilience [5].